Consumer spending on apps to reach $75 billion by 2017

Juniper Research’s latest report has determined that in 2017, over US$75 billion will be spent on consumer apps. This will be largely as a result of the in-app purchase model gaining continued traction across many markets, and the impact of new monetisation models used by developers and storefronts.

The report from Juniper (www.juniperresearch.com) explores how the growing app ecosystem will be strengthened as storefronts such as Microsoft and Amazon attempt to advance against the effective duopoly which Apple and Google presently have. The intensifying competition will lead to the release of new features within these stores, such as better search and discovery tools, encouraging developers to write their apps for the more peripheral stores.

Nevertheless, the report also found that to 2017, the proportion of revenue accrued from apps paid for at the point of download would fall to almost a quarter of the $75 billion total. This presents a challenge for developers who are seeking to maximise the number of users and revenues from their app. Yet Juniper found that developers at the cutting edge of the market were using business models which allowed them to monetize 100% of their user base, through a combination of advertising and in-app purchases.

Report author Siân Rowlands also pointed out that "it is not only developers who are seeking to capitalise on their user base; many app stores are also implementing carrier billing to ensure that unbanked consumers are able to pay for apps, which will contribute to the strong growth in app downloads."

Other key findings from the report include:

° The amount of revenue spent by tablet owners will increase substantially, from $7.8 billion this year to $26.6 billion in 2017.

° The most popular category of app, games, will also see the greatest share of consumer spend, taking 32% of the total revenues in 2017.

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